Leadership - The Link Between Planning & Doing

If you have read the preceding articles in this section on strategic planning, YOU will have a sense that strategic planning involves more than getting together for one day a yearto develop a strategic planning document. Strategic planning is both a logical, rational process, and a process that involves people. It takes more than developing a plan for that plan to be implemented. In this article, we consider that the critical link between planning and doing is leadership.

Traditional Planning Methods

The traditional way for government organizations to plan is for a group of people, usually executives/management, but sometimes including employees, to get together for some period of time each year. Generally, inadequate time is allocated to the exercise, but if it is completed, it results in a document that contains a mission statement, broad organizational goals, and other elements as is deemed appropriate. Then, the plan is usually hidden away somewhere, never to be seen again. Traditional methods yield traditional results. As a wise man once said "If you keep doing what you have been doing, you will get what you have always got".

It needn't be this way.

Reconceptualizing Strategic Planning

Planning should be considered as a blueprint for change. The plan should be the basis for introducing controlled change into an organization so it can adapt to changing times. By anticipating shifting demands, the plan serves the purpose of allowing the organization to control its own direction, rather than waiting until political forces demand change (and demand change NOW). In addition, the plan allows for consistent monitorin~ofsuccess,~nd re-examination of the degree to which organizational resources should be structured and allocated to achieve future goals.

But, if we look at strategic planning in this light, as a blueprint for change, we also need to consider that any organization has built-in inertia.. the tendency to keep on doing what one has been doing. On its own, the strategic planning process, as traditionally undertaken, is insufficient to overcome this inertia. Other forces need to come into play if the plan, and proposed changes get implemented.

Leadership - The Key Force

In the context of strategic planning, leadership means a number of things. We can outline the role of leadership in the following ways, keeping in mind that leadership may come from appointed leaders (management and executive) and from the ranks

. 1.Those in leadership roles ensure that as many members of the organization as possible buy into the values, mission, and broad organizational goals. There are two components to this function. First, leaders manage the perceptions of staff with respect to the planning process. Remember that most people have experienced the "plan-in-the-drawer" syndrome, where effort expended in planning is seen as wasted when the plan is ignored. Prior to the planning process, leaders must emphasize that THIS TIME, things will be different.

Second, leaders manage the planning process so that staff feel that they have adequate input into the process, that they are heard, and their values and visions are incorporated into the final plan and its implementation. Specifically, leaders arrange things so that the process is open, and conforms to accepted rules of communication. That may mean hiring an external consultant to orchestrate the planning sessions. It will certainly mean that rules get established to guide participation. Everyone who wants to participate should have the opportunity, and even reticent staff should be gently encouraged to involve themselves.

2. While managing perceptions of the planning process is important, the critical role of leadership occurs after the plan has been completed. Leaders must treat the planning results as the "organizational signposts that guide behaviour and decision making". After all, nobody is going to take a plan seriously if the formal leaders ignore it, or never refer to it again.

If you are serious about using strategic planning as a tool for organizational success, consider some of the following actions. A. When working with staff to set individual objectives, be sure to mention how the individual objectives will contribute to the achievement of the mission and organizational goals as outlined in the strategic plan. Make sure that the employee is familiar with the plan when individual objectives are set.

In addition, at each meeting with each employee, work with the employee to help him/her determine how the values outlined in the strategic plan apply to them. In other words, given the particular values, strategic goals and mission statement how is the employee to behave or make decisions.

B. Once the strategic plan has been completed, the formal leader of the organization (and perhaps others) should present and discuss the plan with the up-line manager or executive. It is NOT sufficient to send a copy. Because you will need up-line support to implement the plan, you will need their commitment, and commitment will only come from discussion and explanation of the plan.

C. At staff meetings, when decisions are required, explain how the strategic plan is used, or is to be used to make decisions. If you are the manager communicating a decision you have made, explain your rationale in light of the mission, values and goals expressed in the plan. If you are using a participative decision making process, help staff refocus on these components of the plan, so that they can be used to guide decision making

D. When doing performance reviews with staff, ask the individual to explain how his or her actions are consistent with the elements of the plan. How has their action contributed to organizational goals? Has their behaviour been consistent with organizational values? What needs to change so that the individual can further contribute to implementing the plan? Consider recognizing contributions to achievement of the plan, even if the individual did not have specific responsibility as outlined in their individual objectives. And, when setting future objectives, consider writing an objective that refers to the values expressed in the plan. For example: "Will act in accordance with the organizational values expressed in the strategic plan". If you go this route, make sure -that~the implications of these values are clear to the employee in terms of is or er beavior.

3. A final role of leadership is to create more leaders. One goal that formal leaders (executives, managers) can set for themselves is to encourage down-line employees to take on some of the leadership roles outlined above. This can be particularly effective in decision making. The ideal situation is for staff to internalize the plan to the extent that some take on the role of reminding people of the plan, and its relevance to any given decision-making process. Cultivate leaders in your organization by giving increased responsibility, and encouraging this kind of leadership behaviour.

Conclusion

Leadership, regardless of when it comes from formally appointed leaders, or Informal leaders, provides the link between planning and doing. Leadership, regardless of when it comes from formally appointed leaders, or informal leaders, provides the link between planning and doing. Effective leadership helps alter perceptions about strategic planning, and the organization itself, helping to overcome inertia, the tendency to keep things the same.

Without leadership, most strategic plans will end up as dead pieces of paper. Most importantly, when planning occurs without leadership, cynicism increases when staff see that the plan is being ignored, or even violated. The outcome of this is that formal leaders suffer a loss of credibility.

Downsizing -- The Long Term Effects

Few government departments or branches have escaped the necessity of downsizing. The last three or four years have brought almost constant cuts in staffing, and some departments have been "hit" several times. For many downsizing has become an annual process.

When managers are faced with downsizing, they tend to focus on the immediate and practical needs that emerge at the time when staff are being let go. After all, employees need to be selected and notified, one of the most difficult tasks for any manager. Jobs responsibilities need to be shuffled, and generally the period where downsizing is occurring is very busy and emotionally taxing.

Unfortunately, there is a tendency for managers to focus on those that are leaving rather than those that remain. This also holds true for central training and consulting agencies who are asked to support the laid off employees with career development help, counselling, and other supports. There is no question that laid off employees deserve and need these kinds of supports and services. Unfortunately, there is a tendency to forget that after the laid-off workers are gone, the "survivors" must soldier on, and the manager must deal with the long-term effects on the remaining organization.

We are now seeing the effects of downsizing on those that remain. One of the most telling comments is often put forth by employees a year or two after downsizing, and it goes like this: "Sometimes I think that the ones who were laid off are the lucky ones". They usually go on to describe a workplace where employees feel:

. a lack of executive commitment to their functions
. confusion about the priorities of their organization
. increased workloads
. confusion about their mandate
. a sense of being betrayed by executives and managers
. a profound sense of distrust
. a sense of futility with respect to long-term planning
. undervalued and unappreciated

In operational terms, this translates into a number of problems.

. the organization moves towards less risk-taking and innovation
. destructive conflict tends to increase
. internal competition for resources increases
. individual staff members devote less effort to working together and more attention to doing things that will protect themselves.
. general listlessness and lethargy
. decreases service levels and increased public hostility

It is easy to understand these effects when they occur close to the time when down-sizing occurs, and remaining staff "grieve" the loss of friends and colleagues. But, these effects are now being seen as long as one or two years AFTER the downsizing period. There are indeed long term effects of downsizing that need to be addressed.

Understanding The Organizational Downcycle

To counter-act the long term effects of downsizing, managers need to understand how organizations slip into "downcycles".

An organizational downcycle can be characterized as a long-term process where the organization becomes progressively more depressed, insular, protective and confused. The important thing to note is that this process occurs slowly, sometimes imperceptibly, and that if the process is allowed to continue unchecked, it gets worse. The downcycling organization loses its positive momentum and enthusiasm. A vicious circle is formed. It snowballs. Bad feelings and depression become the norm rather than occasional, until, in extreme cases, the organization becomes unable to move effectively, and the work climate can become intolerable for everyone.

Because the process tends to be gradual, managers tend to assume that the problems that occur early in the downcycling will solve themselves without attention. It is easy to assume that staff will "get over" the effects of downsizing over time. This may be the fatal mistake, because if the process is left unmanaged, there is a good chance that staff will become more demoralized.

One final point on the downcycle is in order. When an organization is close to the bottom of a downcycle, it is extremely difficult to turn the organization around. This is because levels of trust, hope and enthusiasm are so low that staff will have little faith in the effectiveness of any approach that promises to be helpful.

Some Prescriptions

1. Proactive management activities are always required when downsizing occurs. Managers must realize that they "can pay now or pay later", and that delaying actions designed to revitalize the organization will result in a huge cost down the road.

Managers should consider that the period immediately after downsizing is critical. Action or inaction during this period will determine whether the organization moves into a depressed downcycle, or makes the commitment to move forward. Downsizing time should also be a time when the organization's mandate and vision are revisited. It should be a time when the manager dedicates him/herself to the long-term health of the organization by clarifying, supporting and building trust. Above all, this is the time where the manager's prime responsibility is to communicate, both with staff, and with executives. One focus of communication should be clarifying mandate, vision, priorities
and commitment levels.

2. Proactive long-term approaches should also be applied by any central agencies charged with "helping" downsizing organizations. Support should be offered to those that are displaced, but, in the long term, help offered to "survivors" will be much more important in determining organizational health. As a manager, ask, or demand that these services be made available by central agencies, or procure them from private vendors, if the central agency won't do the job.

3. If you are in the unfortunate position of man

Conclusion

We are seeing more of the long-term effects of downsizing on organizational health. When downsizing is undermanaged, there is the danger that an organizational downcycle will be created, and left to continue unchecked over several years. The results can be destructive to the organization and the individuals that work there.

It is far easier to avoid or correct this cycle at the time when downsizing occurs, and far less costly. It is important that downsizing trigger organizational renewal strategies immediately.

If proactive action is missing, or is ineffective, corrective actions down the road will require a long term commitment. Once an organization reaches the bottom of a downcycle, it will take considerable time to reverse the process.

aging an organization that is "downcycling", you need to be aware of two things. First, it will get worse if neglected. Second, interventions to turn the cycle around must be considered as long-term projects. One shot consulting or training isn't going to do much, and it may be damaging. Remember that your organization may have been moving downward for a year or two, and that it is going to take a substantial period of time to reverse the process. Positive change will require a consistent effort on your part, and may require consulting help over a period as long as a year.

Content Marketing - Understanding the Why and How

What is content marketing? Content marketing is using relevant and valuable information to attract potential customers to you. This information will not only attract but, if done correctly, will engage your target audience and drive profitable action to your business.

I'm always amazed at the looks and responses I get when I'm speaking to a client and I explain to them they need more content. I'm then almost always questioned "why?"

Think of content as a way of interacting and communicating with your cutomers without selling.

Need proof it works? Think of an article you read that captured your attention and really engaged you. Did you look to see who the writer was? Were you interested in the company that they worked for and the products or services that they offered? If they were using the skills of content marketing, I can almost guarantee you did.

A great article can market your product or service in a way that the consumer is not interrupted. You are using that article to educate your consumer and create an awareness on information that is important to them. This makes your potential buyer more intelligent.

A successful content marketing strategy will deliver consistent valuable information to your target market, when this strategy works you turn the consumers you have targeted into buyers.

Look, it's no secret that consumers are tired of traditional marketing. This is why you see a rush to social media and permission based marketing rather than intrusive marketing that doesn't allow consumers to make the choice of when they want to be marketed to. Why do you think consumers skip commercials, tear out magazine advertisements, and turn on online ad blockers? Because they are taking back control and they will decide when they want to be marketed to.

As a business, you have to be smarter in your marketing efforts and this includes writing content that is not only interesting but relevant and valuable to the market you are targeting.

How do you know if your content is marketing for you? It's easy really. Answer the following questions when reviewing your content or use them as a guideline when creating new content.

• Is it targeting a specific market? If not the content will be too broad to attract a targeted audience.
• Is your content informative, relevant and valuable to those you are targeting? Or is it just a sales pitch?
• Does it educate your target audience about your industry without being too sales oriented and pushing just your products or services?
• Does your message include a subtle marketing message that grabs the reader’s attention and gets them interested in what you offer? The key is the marketing message must create an interest and a desire for what you have to offer without trying to close a sale. Think of it as leaving a faint fingerprint on the mind of the consumer who is reading.
• Does it leave the reader wanting more?
• Does it stir emotion within the reader and inspire action?

If you answered “yes” to the above questions, you have a good piece of content that you can use to market the products or services that you offer. If you were unable to answer “yes” to all of the questions you will want to tweak your content until you can.

You can use content marketing in all areas of your marketing including print, media, events and online. You want to make sure that your website has content that markets to your audience. You also want to make sure that if you have a blog, you are also using it for content marketing. Content marketing is valuable and often leaves a longer impression than any other method of marketing.

How To Improve Your Online Conversion By 300% Or More

Do I have your attention? Anyone trying to make a living online is interested in one thing, improving conversions. As an Internet marketing veteran, I’ve seen plenty of web sites and blogs miss one their biggest opportunities for growth. The answer is actually quite simple, making the most of your list.

Maybe you have your own email list of fifty-thousand names or more. Perhaps you have a small list of just a few dozen prospects who have emailed you questions or comments. Regardless of where you begin, having a list is only part of the equation. The most successful marketers I know utilize their list in a variety of ways to build relationships and sell products that are a win-win for both buyer and seller.

The first way to utilize your list is through an auto responder sequence. If you’re not using an auto responder, I advise you to search for auto responder services online. Popular services like Aweber only charge around twenty dollars per month, allowing you to send unlimited messages. These messages should position you as an expert, provide purchase ideas, and continually provide value.

The second way to use your list effectively is to provide pre-notification of product launches. There are many super affiliates that use their list in this manner, generating tens of thousands of dollars per month. Once you know of an affiliate product being launched within a six to eight week period, map out a pre-launch communication plan that reaches out to individuals prior to launch. This may include access to product information, downloads, videos, etc., to build anticipation around launch day. When launch day comes, create a sense of immediacy and scarcity – purchases will ensue.

The third way to leverage the power of your list is through referrers, building an even larger list that you can communicate with. Are you asking those who sign up for your list to refer your company, products, or services to others? Make your emails easy to forward and encourage referrals. This is a great way to reach individuals who are more likely to value your content and accept your offers.

The final method for leveraging an email list is to communicate on a regular basis. Your auto-responder sequence should integrate a series of messages spread out over time. By continually staying in front of your list and utilizing the content that you have to provide value, these individuals will stay engaged and have a higher propensity to purchase from you.

The time to start building your email list is now. In parallel, be sure to focus your energies on leveraging that list using the proper techniques. Having a great list is fine but unless you utilize it properly, you’ll never see the true value inherent in the list itself.

Organization Improvement Turning Around Negative Attitudes

At one time or another, organizations develop an over-abundance of "negative energy" or attitudes. Sometimes they can be linked to organizational trauma, like down-sizing, budget restraints or workload increases, but sometimes they evolve over time with no apparent triggering event. The negative organization is characterized by increased complaining, a focus on reasons why things can't be done, and what seems to be a lack of hope that things will get better. It feels like the organization in stuck in treacle. And, it's contagious. Negativism can affect even the most positive employees.

What can you do? Based on an article by Arthur Beck and Ellis Hillmar, professors in organization development at University of Richmond, we suggest the following:

Model Positive Behaviour

It is obvious that if management is walking negative and talking in a negative way, staff will follow. Don't do it. More than that, take a positive approach with staff by showing confidence in their abilities. Expect a lot, support staff, hold them accountable, confront them and be clear and honest. Set standards for your own work and relations with employees, and work towards meeting them to set an example of positive behaviour.

Acknowledge Negativity

You can't ignore negativity and expect it to go away. If you do not acknowledge it, then staff will feel that you are out of touch, and will not be confident in your abilities. Acknowledge the frustration negative feelings, and do not try to convince the person or people that they shouldn't have their negative feelings. However, when acknowledging employees' negative feelings, try asking for suggestions regarding what to do about them.

Look For And Identify The Positives In All Situations

Sometimes we forget to find positives. When an employee makes an impractical solution, we are quick to dismiss the idea. We should be identifying the effort while gently discussing the idea. Look for small victories, and talk about them. Turning a negative organization into a positive one is a result of thousands of little actions.

Give Positive Recognition Often

Pretty straight-forward. Provide positive recognition as soon as you find out about good performance. Do not couple positive strokes with suggestions for improvement. Separate them. Combining them devalues the recognition for many people.

Refrain From Collusion On Negativity

It is easy to get caught in the general complaining and bitching, particularly in informal discussions. When faced with negative conversations, consider changing the subject, comment on the negative content ("Let's talk about something more pleasant"), or ask what can be done about the situation (move from negative to positive slant).

Front and Center - Leadership Critical To Managing Change

When change is imposed (as in downsizing scenarios), clearly the most important determinant of "getting through the swamp", is the ability of leadership to...well, lead. The literature on the subject indicates that the nature of the change is secondary to the perceptions that employees have regarding the ability, competence, and credibility of senior and middle management.

If you are to manage change effectively, you need to be aware that there are three distinct times zones where leadership is important. We can call these Preparing For the Journey, Slogging Through The Swamp, and After Arrival. We will look more carefully at each of these.

The Role of Leadership

In an organization where there is faith in the abilities of formal leaders, employees will look towards the leaders for a number of things. During drastic change times, employees will expect effective and sensible planning, confident and effective decision-making, and regular, complete communication that is timely. Also during these times of change, employees will perceive leadership as supportive, concerned and committed to their welfare, while at the same time recognizing that tough decisions need to be made. The best way to summarize is that there is a climate of trust between leader and the rest of the team. The existence of this trust, brings hope for better times in the future, and that makes coping with drastic change much easier.

In organizations characterized by poor leadership, employees expect nothing positive. In a climate of distrust, employees learn that leaders will act in indecipherable ways and in ways that do not seem to be in anyone's best interests. Poor leadership means an absence of hope, which, if allowed to go on for too long, results in an organization becoming completely nonfunctioning. The organization must deal with the practical impact of unpleasant change, but more importantly, must labor under the weight of employees who have given up, have no faith in the system or in the ability of leaders to turn the organization around.

Leadership before, during and after change implementation is THE key to getting through the swamp. Unfortunately, if haven't established a track record of effective leadership, by the time you have to deal with difficult changes, it may be too late.

Preparing For The Journey

It would be a mistake to assume that preparing for the journey takes place only after the destination has been defined or chosen. When we talk about preparing for the change journey, we are talking about leading in a way that lays the foundation or groundwork for ANY changes that may occur in the future. Preparing is about building resources, by building healthy organizations in the first place. Much like healthy people, who are better able to cope with infection or disease than unhealthy people, organization that are healthy in the first place are better able to deal with change.

As a leader you need to establish credibility and a track record of effective decision making, so that there is trust in your ability to figure out what is necessary to bring the organization through.

Slogging Through The Swamp

Leaders play a critical role during change implementation, the period from the announcement of change through the installation of the change. During this middle period the organization is the most unstable, characterized by confusion, fear, loss of direction, reduced productivity, and lack of clarity about direction and mandate. It can be a period of emotionalism, with employees grieving for what is lost, and initially unable to look to the future.

During this period, effective leaders need to focus on two things. First, the feelings and confusion of employees must be acknowledged and validated. Second, the leader must work with employees to begin creating a new vision of the altered workplace, and helping employees to understand the direction of the future. Focusing only on feelings, may result in wallowing. That is why it is necessary to begin the movement into the new ways or situations. Focusing only on the new vision may result in the perception that the leader is out of touch, cold and uncaring. A key part of leadership in this phase is knowing when to focus on the pain, and when to focus on building and moving into the future.

After Arrival

In a sense you never completely arrive, but here we are talking about the period where the initial instability of massive change has been reduced. People have become less emotional, and more stable, and with effective leadership during the previous phases, are now more open to locking in to the new directions, mandate and ways of doing things

This is an ideal time for leaders to introduce positive new change, such as examination of unwieldy procedures or Total Quality Management. The critical thing here is that leaders must now offer hope that the organization is working towards being better, by solving problems and improving the quality of work life. While the new vision of the organization may have begun while people were slogging through the swamp, this is the time to complete the process, and make sure that people buy into it, and understand their roles in this new organization.

Conclusion

Playing a leadership role in the three phases is not easy. Not only do you have a responsibility to lead, but as an employee yourself, you have to deal with your own reactions to the change, and your role in it. However, if you are ineffective in leading change, you will bear a very heavy personal load. Since you are accountable for the performance of your unit, you will have to deal with the ongoing loss of productivity that can result from poorly managed change, not to mention the potential impact on your own enjoyment of your job.

How to Choose a Forex Broker

Choosing a good forex broker is one of the most important decisions you need to make at the beginning (or at any point) of your forex trading career. Do not take this decision lightly, but at the same time don’t stress over it – the process does not need to be complicated – just like in your trading decisions, once you do your homework, things tend to fall into place. Chance favors the prepared trader and everything you need to make an informed decision is listed right here. All you have to do is follow the advice given and you will find yourself a broker that suits your needs. If you are not familiar with what is available, you can have a look at the brokers we have listed in our Broker Reviews section to familiarize yourself with who is who in the forex world. If you have already narrowed down your search to just a few, or even one broker, and want to be sure that they are in fact what you want, then keep reading.

Regulation (the "Legitimacy Test")

The first thing you need to do is check whether the broker is regulated. The fact that the forex market itself is not regulated opens the door to a lot of possibilities for a scheming mind. There are shifty brokers out there, ranging from outright scams to just badly run businesses which are not accountable to any regulatory body. The brokers who are regulated choose to be so, in order to add a layer of legitimacy to their reputation. Please do NOT fund any accounts with an unregulated forex broker. There are not many good reason to do so, and plenty of reasons not to. It just makes sense.

By far the most respected regulatory bodies are the US-based National Futures Association (NFA) and Commodity Futures Trading Commission (CFTC). Most forex brokers, even if they are not based in the United States, are members of the NFA and registered Futures Commission Merchants (FCMs) with the CFTC. The UK based Financial Services Authority (FSA) is also a well respected regulating body, as is CySEC (Cyprus), ARIF (Switzerland), ASIC (Australia) and SFC (Hong Kong) among others. Just because a firm writes on their website that they are regulated however, does not make it so. Always check the websites of the regulating bodies themselves – they all offer a searchable database that allows visitors to find regulated members by name:
NFA/CFTC: http://www.nfa.futures.org/basicnet/
FSA: http://www.fsa.gov.uk/register/home.do
ARIF: http://www.arif.ch/en/membres.htm
CySEC: http://www.cysec.gov.cy/licence_members_1_en.aspx
ASIC: http://www.search.asic.gov.au/gns001.html
SFC: http://www.sfc.hk/sfcprd/eng/pr/html/PR002.jsp?charset=ISO8859_1

It is also important, particularly for US-based forex brokers, to be well capitalized. Well capitalized companies tend to be much more stable and less prone to insolvency. This is particularly true in the US because brokers here are not required to keep client funds segregated from company operating capital, so clients are at increased risk in case of insolvency. For CFTC registered FCMs, you can look up the broker’s operating capital:
http://www.cftc.gov/marketreports/financialdataforfcms/index.htm

Furthermore, if the broker does keep client funds segregated, it is certainly a bonus, since it provides additional protection of client funds even in case of insolvency. FSA regulated brokers, for example, are required to keep client funds segregated. This of course begs the question, where are the funds being kept? Are they in a safe account at a large bank or some dodgy private bank in the Cayman Islands? You can find answers to these questions in our broker reviews section. Alternately, the broker’s customer support should be able to answer these questions. If they cannot, they may be hiding something (or the customer service rep may simply be incompetent - either way it's not a good sign).

Finally, as far as legitimacy is concerned, it is always prudent to check the WHOIS database for the broker's domain name. If the contact information they provide is misleading, such as a virtual office, or hidden using a privacy protection service such as PrivacyProtect.org, it should immediately raise flags. Any serious business should freely display their real contact information instead of hiding it.

Timeframes

OK, so your broker has passed the “legitimacy test”. They are regulated, well capitalized, and they don’t mix client funds with operating capital. Now it’s time to make sure that they provide the type of trading conditions that suit your trading style. Depending the timeframes that you trade, it may be important for spreads/commissions to be very low. Also, if you trade very short timeframes (scalping) you should make sure that your broker doesn't have a problem with that. Generally, brokers who are market makers will have a problem with it, while brokers that use straight-through processing or actual ECNs generally don't mind. Please read our "ECNs vs. Market Makers" article if you are not sure what that means. If you are a day trader, then your transaction costs can make you or break you. If you enter and exit the market several times per day, these costs really add up. Consider, for example, that you are trading 1 mini lot (10,000), 5 trades per day on EUR/USD. If the spread your broker offers you is 3 pips on average, then you are paying $3 per trade, $15 per day, $300 per month etc… you get the picture. If you instead had a broker that offers you an average spread of 1 pip on EUR/USD, then you would be paying $1 per trade, $5 per day, $100 per month! That’s a difference that anyone serious about their business should not ignore.

On the other hand, if you are a position trader, who makes 5 trades per year, then the difference amounts to only $10 per year. This is minimal and may very well be outweighed by other factors, such as perhaps higher overnight interest rates in a carry trade strategy, or better customer support or some other factor that gives you more than $10 of value added with the higher spread broker. So neither broker is better or worse, they are just better suited to different styles of trading.

Automated vs. Discretionary Trading Styles

Some broker platforms are also better suited to automated trading. For example, MetaTrader 4 (MT4) is a favorite among retail traders who program their own “Expert Advisors” or “EAs”. If that’s you, then this could be a determining factor when choosing a broker. On the other hand, if you are a discretionary trader who bases trading decisions on a combined technical and fundamental analysis approach, then it may not matter to you whether the broker offers MT4 or not, as long as the platform offers you good charting. You can visit our broker reviews page for details on which brokers use which specific trading platforms.

Islamic Swap-Free Accounts

Another factor could be a broker’s choice to offer Islamic accounts, which do not charge or pay any rollover or swap interest. Traders bound by Sharia Law are not allowed to conduct any business dealing with interest, so some brokers may be off your list as a result. Many brokers offer swap-free accounts, but many also do not. Moreover, some brokers that do offer swap-free accounts may do so only under certain conditions (read extra fees), since such accounts are susceptible to abuse, and brokers are very much aware of that.

It should also be noted that the brokers who do offer swap-free accounts to all their traders, with no extra charges, are a great choice for non-Islamic traders as well, if they simply want to short the carry trade - just be careful, as most such brokers are not regulated.

Tradable Instruments

Finally, when it comes to trading style, some forex brokers have a much wider range of tradable instruments than others. In addition to the major currency pairs, some brokers allow you to trade exotic pairs (such as PLN/SGD or Polish Zloty vs. Singapore Dollar) Gold, Silver, Oil or any number of other instruments. You may or may not find these of interest, but if you do, then going with a broker where you can trade your desired instruments is a must.

Minimum deal sizes

Another concern, particularly for smaller accounts, is minimum deal sizes. Some brokers only allow you to trade standard lots (100,000), which does not give someone with a $5,000 account very much flexibility when it comes to money management. Money management is a very important aspect of any trading strategy, and the finer “resolution” you can get when calculating deal sizes, the more accurately your money management calculations can be reflected in reality. This is an often overlooked or at least underestimated factor when it comes to choosing a broker, but it is absolutely critical. The best choice for small account holders are the brokers that offer traders deal sizes as small as 1 unit, giving traders maximum flexibility when choosing the size of their trades and positions.

Leverage

In contrast, an often overestimated factor involved in the appropriate choice of a broker is maximum leverage allowed by the broker. Most forex brokers have a margin requirement of 1% or even lower, which allows for 100:1 maximum leverage – more than enough for any sensible trader, and yet some traders insist on ridiculous 0.25% margin requirements. This has been the highway to ruin for most who have tried to use anywhere near that much leverage. You don’t have to be a genius to see why, since leverage multiplies your drawdowns. All it takes is a small losing streak and your account is blown. In any case, this is not a lecture on the pitfalls of high leverage. We can address that in another article. Suffice it to say that low margin requirements and the resulting high maximum leverage should NOT be a factor when choosing your forex broker.

Customer Support

One way to get a glimpse inside your forex broker’s business is to contact their support staff by a variety of methods. Send emails, use live chat, call them, get them to call you, whatever. No matter how small or irrelevant your questions may seem, they are important. Not only because you are a potential customer and you deserve their time and attention, but also because it allows you to judge how committed they will be if you do open a real account with them. If they are unable or unwilling to spend time with you to answer your questions now, then they most likely won’t act any differently after they have received your money. I encourage you to ask as many questions as you can think of, sometimes even ones you know the answers to, just to see if they will lose patience with you or refuse to answer questions that may seem obvious, or that expose their weaknesses. Some brokers get defensive when you ask them about regulation, for example – not a good sign. Make sure you also ask some tough questions about their internal systems, such as how they process orders, if they offset client orders in a higher tier or if they are the counterparty to clients’ trades, ask them about their liquidity providers, withdrawal fees etc (if you are not sure what these things mean, please refer to our "How Forex Brokers Work" article). These are all things that a client has the right to know. Any decent broker has to respect that and give you the answers. There is no reason not to, unless they have something to hide. It is also a good idea to keep a record of all your correspondence with your broker, just in case some disagreement arises in the future.

Test-run the Platform

All forex brokers nowadays offer traders the ability to test their trading platform with a demo account. Before funding a real account, it is highly recommended that you do this. It will give you an idea of how the platform performs. Are there any glitches? Is it stable? Is it fast? Is it easy to use? Is the charting package any good? Does it have the features I need? These are all questions you can answer very quickly when trading on a demo account. What you cannot know from trading a demo account, unfortunately, is how order execution will be on a real account. Execution is always flawless on demo, but this is not representative of the real market and can be vastly different if/when you make the switch to real market conditions. It is also not possible to withdraw the money from a demo account (very unfortunate), so you cannot judge how quickly these are normally processed. The same goes for deposits. The best way to get an idea of this is to have a look at our broker reviews page, where we have tested each broker with a real money account, and given them a 0-5 rating on how good their order execution is, how quick their transaction processing is, and a number of other important facts.

How we can help

We built a broker review section that is specifically designed with the above criteria (and more) in mind. We have listed all the information you could possibly want to know about each broker in order to help you choose the right broker for your individual needs. This is the most detailed information you will find anywhere, because we have thoroughly tested each broker with real money accounts. We keep adding new broker listings all the time, so check back every once in a while. We hope you find it useful.

Being a trusted expert

TheCompounder.com¹³. Then read the about us page. Sign up for the newsletter as well. If you have a few minutes, pick a product and start the checkout process. If you really like the product, buy it.

While you're doing that, read the copy on each page. And if you buy, read the follow-up e-mails and the printed materials in the box when the product arrives at your home. (Disclaimer: I'm a customer of this site, but don't stand to make a single penny from recommending it. I'm just using the site to make a point.)

Being a trusted expert may sound like a simple task, but it isn't. Before you can write in a way that helps your visitors, you have to recognize and achieve a number of things.

Create a site to compete with The Compounder

How would you do that? How would you compete? The truth is, it's very hard to compete directly with a site like this. There are already other sites where you can buy much of what he sells, maybe at better prices too.

But this site isn't about offering the lowest prices. Nor is it about free shipping offers or bulk discounts. So why do people buy from this site, and not others? The answer is simple. It's because they trust Larry Frieders.

That trust isn't based only on the fact that he is a pharmacist. That trust is also based on him, as an individual. Larry is not only the pharmacist, he's also the writer of the site and the newsletter. You hear his voice in ever line you read.

You don't hear the slick writing of a professional copywriter or marketer. That doesn't mean he doesn't try to make the sale...he does. But every line is real and sincere. His photo is on the site, and on his newsletters. He is making himself personally accountable for every product sold and every word written.

He also makes sure that his readers are provided with all the information they need. He is not only a seller of products, he is also a trustworthy source of information on a variety of important health matters.

And he has been doing the same thing for years...building his site, his list and his base of loyal customers little by little and step by step.

This is a solid, enduring business that should prosper for many years to come. Online trends can come and go. Price wars can flare up and then die down. But unless Larry Frieders makes some big mistakes, or decides to retire, his business is wonderfully insulated against all kinds of competition.

Applying this approach to other businesses

You don't have to be a pharmacist or some other 'trustworthy' professional to make this model work. It's not about the qualification. It's about being there, being honest, being accountable, personally... and offering a product or service that is truly useful or valuable.

You can sell garden equipment. You can sell white papers and guides. You can be a reseller of travel products, financial products. You can consult on technology or business. What you do doesn't matter.

What matters is putting yourself upfront. Write the site in your own words. Make your own promises, personally, one-to-one.When you do that, honestly and completely, you separate yourself from all your competitors.